A key element of this plan is a new program—State Innovation Grants—that could fund high-risk pools to cover people with pre-existing conditions. Historically, high-risk pools served as an alternative to guaranteed access to broad-based private insurance for people with pre-existing conditions. The rationale behind such pools is to insure these individuals separately, thus preventing their high costs from raising premiums for others.

Yet, researchers have found that the performance of high-risk pools often suffer from insufficient funding, constraints on eligibility, and gaps in coverage...